Prosperity Watch Issue 59, No. 3: Underemployment widespread in North Carolina

Our economy is leaving far too many North Carolinians without a job that can support a family. The Bureau of Labor Statistics, which tracks unemployment, found that more than 200,000 North Carolinians were forced to take part-time employment in 2015 because full-time work was not available.

The headline unemployment rate, which does not include discouraged workers or part-time employees who would like to work full time, came in at 5.9% for North Carolina in 2015. However, including discouraged workers and people forced to take part-time jobs would put the level of underemployment over 11%. In both cases, North Carolina is faring worse than the national average, but the gap is larger when underemployment is included.

Economic distress remains elevated in North Carolina regardless of which measure is used. The North Carolina headline unemployment rate was 1.4 points higher in 2015 than it was in 2007, before the Great Recession took hold. The share of North Carolinians who are either unemployed or forced to take part-time work is almost 3 points higher than before the recession. In both cases, the increase in economic distress has been larger in North Carolina than for the United States as a whole.

The disconnect between the headline unemployment rate and the experience of those seeking work and good jobs is not just a curiosity for wonky analysts, it has real consequences for how economic policy is discussed in North Carolina. State leaders often invoke the headline unemployment rate to assert that North Carolina's economy is roaring along. That line of thinking ignores the hundreds of thousands of North Carolinians who desperately want full-time work but are forced to settle for part-time jobs.

Looking beyond the headline unemployment rate shows that our state’s economic recovery remains incomplete. So long as there are hundreds of thousands of North Carolinians who cannot find full-time work, we have to confront the fact that policy changes over the last few years have not solved our economic challenges.

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